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Turning Numbers into Actions

Today's executives are facing mounting pressures from a variety of new sources. The Traditional demands of product evolution and revenue generation remain unchanged. However, the wide-ranging ramifications of digitisation are forcing business leaders to evaluate new dimensions, such as customer experience, channel management, IoT, blockchain, and the associated compliance and legal exposures that lurk within the digital economy.

This accumulation of additional topics is flooding the agendas of key operational leadership, who find themselves in a crowded and demanding digital landscape. Yet the CFO alone remains wedded to an analogue world, wedded to the demands of regulatory reporting, tax, and compliance, which demand significant manual intervention and judgment.

The result is that there is tension in the C-suite between the digital and analogue. The operational leadership of the company shapes the future and is grappling with the changing landscape of a hyper-competitive digital economy whilst pursuing the resulting revenue opportunities. The CFO is then left to translate the actions of their peers into a different language, one that satisfies stakeholders and legislative requirements. This translation demands the talents of an excellent communicator who understands the digital journey the company is undertaking and can articulate the consequences of these decisions using the analogue languages of compliance and regulatory reporting. 

This best of breed, digital-savvy CFO can make this translation due to their success in building governance models that feed the necessary information to decision-makers. The transition to a digital company is accelerated by observing how operational risk reacts to the unpredictable nature of the digital market. The CFO also needs to also have anticipated the resulting avalanche of data that these digital business models generate and navigated a way of ingesting and processing this information. 

This success enjoyed by leading CFOs results from integrating data from across the organisation to produce the numbers they require for decision making. Such a platform will only exist where the CFO has dedicated efforts to explicitly coordinate actions to create a harmonised view of all aspects of performance in the digital market. A demanding achievement that permits the CFO to cost-effectively present a consolidated information to the leadership team, without losing fidelity within individual functional domains or technical specialities. 

Through this harmonisation of information, contemporary CFOs are critical to the great digital transformation, as the insights obtained from big data and associated technological challenges are all manifest in the numerical results collected by the finance team. Financial results that track the impact the digital revolution has on the company’s competitive landscape and revenue projections. Financial results that enable a confident executive team to drive decisions that result in positive outcomes.

The challenges facing the CFO in this aggregation and harmonisation task are much more than scale. They need to understand the digital agenda, translate this into language the market recognises, and then shape this narrative to allow vital management decisions in shorter timescales. These decisions will also encounter far greater scrutiny due to increasingly more rigorous reporting and compliance obligations, so the CFO needs to factor additional transparency into their processes.

Clearly, the digital-savvy CFO is under a tremendous load. They occupy a wholly unglamorous position in the executive team and one where the consequences of failure could quickly derail the digital transformation of the company. Yet, if the CFO draws together the right information, from a large number of sources, can aggregate this quickly and with the correct analysis they will be able to covert this governance in the (right) decisions and ultimately, to a strong position in the digital economy.

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Tim Scammell
Blog group founder

Tim Scammell

Office of the CFO

SAP

Member since

27 Jan

Location

Saffron Walden

Blog posts

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More from Tim

This post is from a series of posts in the group:

Financial Transformation

The pace of evolution for many corporate finance and accounting functions is accelerating. The mandate of the CFO is expanding and the challenges they face accumulating. This blog is an exploration of these topics.


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